Analyst opens Hanesbrands coverage with 'Buy'

NEW YORK — Shares of Hanesbrands Inc. rose Tuesday as an analyst starting to cover the maker of pantyhose, underwear, casual clothes and active wear gave it and initial "Buy" rating, saying the company will likely see earnings growth as consumer spending picks up.

The company, whose brands include Champion, L'eggs, Wonderbra and Duofold, reported last month that it lost money during its fiscal fourth quarter. But its adjusted profit was even with analysts' expectations.

Clothing makers and retailers have suffered during the recession as shoppers have cut their discretionary spending.

Sterne Agee analyst Kenneth Stumphauzer said in a client note that Hanesbrands is one of the best stocks to have on hand amid signs of an economic recovery. He said Hanesbrands, based in Winston-Salem, N.C., could grow its earnings quickly over the next three to five years.

Stumphauzer set his price target for the company's stock at $27. The shares added 61 cents, or 2.8 percent, in afternoon trading Tuesday, climbing to $22.41. They have traded between $5.14 and $26.61 over the last year.